UK-based Hystead, a joint venture between South Africa's Hyprop Investments and PDI Investment Holdings, has acquired a 90% interest in two Croatian shopping centres for a net purchase price of €129 mln and the assumption of €154 mln of asset-secured five-year loans.
The two malls, City Center one West and City Center one East, are located in Zagreb, the capital of Croatia. They are being sold by developer and landlord, Austrian group WKB 3 and its CC Real unit.
City Center one East provides 60,000 m2 of lettable area with the potential to add a further 10,000 m2. City Center one West offers 46,000 m2 with the potential to add a further 13,600 m2. The majority of the leases are denominated in Euros or Euro-linked.
The transaction, which reflects a 7% yield, is expected to close at the end of March 2018.
WKB 3 will retain a 10% interest in the assets after the acquisition and will be in charge of property management for an initial period of eighteen months.
Hyprop's CEO Pieter Prinsloo said: 'The acquisition is further realisation of our strategy of investing in high-quality shopping centres that are dominant in their catchment areas.'
Hystead, which focuses on dominant shopping centres in South Eastern Europe, has built up a €740 mln portfolio of six centres in Montenegro, Serbia, Macedonia and Bulgaria over the past two years. The company is 60% owned by Hystead and 40% held by PDI, a company associated with Louis Norval, a non-executive director of Hyprop.
Majority shareholder Hyprop said that it intends to float Hystead on the Euro MTF market of the Luxembourg Stock Exchange and on the Main Board of the Johannesburg stock exchange within the next six months.
The listing will allow Hystead to refinance the bridge loan used to finance the equity portion of the Croatian deals.
